Easy Steps to Improve your Financial Situation

 

 

 

We all want be able to utilize our limited funds in such a way as to improve our daily lives. You work hard every day and yet it never seems to be enough to get ahead. Here are some simple steps you can take that might just make a difference!

 

  1. Analyze Current Spending -You must know how you spend the money you receive each week before you can develop new ways to save.

 

·        Write down all your Fixed Costs (Those costs that you must pay as a result of a contract or a requirement of daily life). Examples: mortgage, rent, electricity, or food. Take the time to analyze each of these bills and ask yourself if the cost is truly required. Start by asking your self questions. For instance you may have a mortgage on a home that is so large that it is making it difficult for you to pay for other necessary items. Can I down size or refinance in such a way as to save money? How can I save on energy costs?

 

·        Write down Variable Costs (Those are costs that you are not required to make, but simply choose to) Examples: vacations, expensive clothing, entertainment, or dinner at a nice restaurant. Once again, begin by asking questions. Do I need these items? Are there better ways to utilize my funds? Am I getting the most benefit out of the money I am spending?

 

2        Develop a New Spending Plan – First Priority – Spend less than you earn! Decide first how much you want to save. Make saving a priority. Consider your retirement and where you want to be in the future. Create a new budget that reflects your daily goals and objectives. Then discipline your self to stay within the budget.

 

3.  Credit Cards – Eliminate all but absolutely needed credit cards. Most people can live with only 1 or 2. If possible pay all credit cards in full every month. Most

Credit Cards have very high interest rates and huge penalties. Having too many cards makes it difficult to control and even could hurt your credit score. If you are currently paying high interest rates look for lower cost debt consolidation loans and eliminate credit card debt. This is a good time to get rid of all, but one card and use it only when absolutely necessary. An important note: Minimum payments are not for your benefit it s for the credit companies benefit. They will take more of your money in high interest rated!

 

  1. Borrowing -. Only borrow for capital Items. Its may be great to borrow for the purchase of a new home or to invest in a business that has a long term value or a solid return, but avoid borrowing for short term purchases. Furniture, vacations, and other small purchases should come out of savings.

 

  1. Invest Wisely – If your company has a 401K or any kind of plan where they match the money you put into it join it as soon as you can. Having money in regular savings accounts has little

      investment value. If you can, invest in long term plans that have stability and reasonable growth potential. Talk to a representative of your bank or someone who is a professional advisor. Beware of

      high risk investments that promise a huge return.